HR 2930 will finally legalize investment in small local businesses -- allowing you to take your investments out of Wall Street and into your local community.
A growing body of evidence suggests that small, local businesses are essential for growing jobs, incomes, equality, entrepreneurship, smart-growth, and green communities. But 99% of us are not permitted to invest in them.
The 1% who are millionaires (known under federal securities law as “accredited investors”) are free to invest in anything they choose. The rest of us are stuck with the slim pickings of the Fortune 500 public companies listed on Wall Street—the companies least connected to the well being of our communities.
But a remarkable coalition has emerged bringing together leaders of the Tea Party and the Obama Administration. They agree that this "investment apartheid" should be abolished. Patrick McHenry (R-NC) is leading the charge in the House to legalize small businesses raising money through large numbers of small investments (aka “crowdfunding”), with minimal paperwork, for companies raising less than $1 million. Recent changes in his bill (HR 2930) actually make it very similar to reforms President Obama proposed in his jobs package in September. The President has thrown his support behind HR 2930.
What's needed now is for the US Senate to step up in a bipartisan commitment to our local economies.
Please let your Senators know that you want them to break the chains that keep our investments – four times the amount of money kept in banks – from where they are most needed, our own communities.
Pass Legislation Legalizing Local Investment
99% of Americans are not permitted to invest in local small businesses, despite the clear evidence that these businesses are essential to creating jobs and rebuilding our communities. That's nearly $15 trillion of long-terms savings - in the form of stocks, bonds, mutual funds, pension funds, and insurance funds - that can only be invested in Fortune 500 public companies listed on Wall Street, the companies least connected to the well being of our communities.
For decades, we’ve lived under an oppressive system of investment apartheid. The 1% who are millionaires (known under federal securities law as “accredited investors”) are free to invest in anything they choose. But before small businesses can accept investment from the 99% of "unaccredited investors", they have to spend many tens of thousands of dollars on legal, accounting, and government filing fees. While most of us would like to invest in small businesses in our community, practically speaking, securities laws make it impossible.
If we could overhaul securities laws that no longer serve us, local businesses could be fabulous investments. They are the most important job producers in the economy. They account for more than half of private sector jobs. They are increasingly competitive—so much so that their their share of the national workforce actually growing. Stunningly, sole proprietorships are three times as profitable as C-corporations.
For the first time in decades, reform is finally possible. A remarkable coalition has emerged bringing together Tea Party Republicans in the House of Representatives and the Obama Administration. They agree that investment apartheid should be abolished. Republican Representative Patrick McHenry of North Carolina is leading the charge in the House to legalize small businesses raising money through large numbers of small investments (aka “crowdfunding”), with minimal paperwork, for companies raising less than $1 million. Recent changes in his bill (HR 2930) actually make it very similar to reforms President Obama proposed in his jobs package in September. The Obama Administration has stated its support for HR 2930 on November 2, 2011.
What's needed now is for Senators such as yourself, who share the desire of so many Americans to even the playing field for local small businesses, to seize this opportunity and swiftly pass legislation that mirrors the reforms in HR 2930. Millions of Americans have already changed their buying habits to buy local. Now’s our chance to invest locally too!
Please stand with your constituents and the local small businesses of our State by supporting "crowdfunding" legislation.